The Priv is the first Android-powered smartphone from BlackBerry Ltd. (TSX:BB)(NASDAQ:BBRY); it was launched just under a month ago through online channels and in a handful of carriers across several countries.
When it was released, the phone garnered rave reviews, claiming that the device was a dose of fresh air, both for Android users longing for a secure device with a good keyboard and for BlackBerry, who finally released a device with up-to-date hardware on a platform consumers wanted to use.
We’ve been down this path before. When the innovative Passport was launched last year, it too was deemed a successful launch with online channels and carriers selling out in a mere six hours. When it came to results time for the most recent quarter, the dismally small number of BlackBerry devices sold was revealed to be just over 800,000. Compare this with a year ago, when the company sold approximately two million devices and you can begin to see the bigger issue.
CEO John Chen has publicly stated on more than one occasion the target for the hardware division should be five million devices a year–that’s a tall order for BlackBerry to fill.
Where does the company stand now a month later? Let’s take a look.
Promises kept, holes patched
One of the main selling points of the Priv was that BlackBerry would be providing monthly updates to the software, patching any holes in Android as well as addressing any bugs in BlackBerry’s software.
The first update rolled out this week, right on schedule; there were a number of security updates, bug fixes, and application updates that will make the device more stable and improve efficiency and battery life.
While it is still too early to tell whether BlackBerry or not will stick to the promises it made, the commitment to releasing updates on time is very admirable.
Even more impressive for the company is that the security-focused applications that are on baked into the Priv are gaining in popularity; some users even hope the suite will be made available as a separate revenue generator to install for those using another device.
Security is still the focus
BlackBerry has always been about security. This hasn’t changed with the launch of the Priv, nor has the company steered away from security at a broader level. The Priv has a number of security-related enhancements that are some of the many reasons that users are flocking to the device.
On a broader security front, this week BlackBerry announced it would be exiting the market in Pakistan, because of BlackBerry’s refusal to hand over BES traffic communications and messages to Pakistani authorities.
This is a move to be applauded as the company is clearly putting the security and privacy of user data in front of big-brother type requests from a single government, even if it means cutting out millions of potential users in the country.
BlackBerry currently trades at just over $10. The stock is up by 2.6% in the past month and extending this out over the current quarter shows a 4.8% increase. John Chen has already stated that the company’s goal is to return to profitability in 2016, and by all measures it appears the company is going to accomplish that goal.
In my opinion, the stock is undervalued and is trending towards a brighter and profitable future. Investors with the tolerance to hold their positions regardless of short-term fluctuations will be pleased with what the company will offer over the long term.